Programmatic allows publishers to be as compelling to advertisers as Facebook if they embrace data, says Richard Fitzgerald*
Advertisers are able to use programmatic to target specific audiences across several platforms. They know which users are members of those audiences and have some idea what they’re worth, but publishers don’t. This causes information asymmetry, which leaves publishers at a disadvantage.
While publishers fear programmatic devalues their ad offering and inventory and drives rates and margins down, it also offers opportunities for greater efficiency in general ad sales operations. A smart publisher will use this to their advantage.
Programmatic allows advertisers to target the exact demographic profile that they want. Targeting people who are already interested in their products, or likely to be, or a whole host of other data that programmatic offers means conversions are far more likely to take place. Rather than casting the net wide, it’s cast in a way to catch only the right demographic.
The customer benefits as they are seeing relevant, interesting content and ads that may genuinely be of use to them. On both ends of the process, participants reap benefits. A good publisher’s concern is the content, and if programmatic empowers content and provides users with a better experience, then it should be embraced.
What’s more, by embracing programmatic and data, publishers can elevate their position to that of industry disruptors such as Facebook. After all, Facebook is the world’s most popular media owner but creates no content. Facebook does, however, know every one of its users and has ensured the user experience is beneficial enough to make sure hundreds of millions of users come back every day.
Content marketers who adopt the programmatic approach have the opportunity to build relationships with programmatic ad trading desks. They’ll also be able to win better rates and move between the different programmatic strategies.
Programmatic, although hard to exactly measure, is growing. For advertisers, it allows brands to scale more quickly and target ads more precisely. And its heavy usage by online-only publishers is one reason why marketers are shifting some of their budget away from traditional publishers. However, programmatic ad trading can also bring benefits for print publishers looking to grow their online presence as it removes all the time-consuming processes that used to exist.
So, is programmatic the saviour of publishers?
The rates received on programmatic are seldom only enough to run an entire advertising business. Most of this traffic is still coming from Facebook, and they themselves have their own SSP (supply-side platform), Facebook’s Audience Network. However, it does allow publishers to really understand their audiences from a data point of view, which in turn creates opportunities to offer more value to advertisers.
Programmatic should be used to supplement native advertising. Buzzfeed is an example of a ‘new media’ company that’s monetising on branded content alone, as it does not run any programmatic. However, its former head of sales is now running the commercial side of things for the Daily Mail Online, and has since seen the benefits of combining programmatic revenue with branded content revenue.
Creating compelling content in native formats is the most effective way for advertisers to reach a publisher’s audience. However, there is a difference between writing an article for those interested in sports in Dubai, and specifically targeting a male, between 34 and 45, who is interested in golf, is left-handed, and lives in Dubai. Not even Facebook can do that.